HomeMy WebLinkAboutHRA Item 04
November 20, 2017 Item No.
HRA Meeting
RESOLUTION DECERTIFYING TAX INCREMENT FINANCING DISTRICT NO. 20
Proposed Action
Staff recommends adoption of the following motion: Approval of a Resolution to decertifying Tax
Increment Financing District No. 20.
Overview
The HRA approved the creation of a new Tax Increment Financing (TIF) District and a Contract for
Private Development in July of 2015 to facilitate the expansion of Mendell Machine and Manufacturing.
The expansion consisted of an 18,000 square foot expansion of the existing 28,600 square foot
manufacturing facility located at 21463 Grenada Avenue just off of County Road 70. The expansion was
completed in December of 2015.
The Contract for Private Development also provided that Mendell retain the existing 93 jobs it had in
2015 and add an additional 12 new jobs by July of 2017. As the attached letter from Bryan Bartz,
President of Mendell indicates, the company has not been able to meet their job creation goals due to the
lack of skilled labor in their industry of precision machining of medical device components. The
company has requested that the Contract for Private Development be terminated.
The termination of this agreement will result in the decertification of the TIF District No. 20 that was
created for this expansion and eliminate the reimbursement of up to $155,000 in project eligible costs to
Mendell. The additional property taxes created by the expansion will not be captured in the TIF District
but rather beginning in 2018 will be allocated to the City, County and School District. There is currently a
negative balance of $4,331 in this TIF District associated with the legal and consulting costs with creating
the District. Staff will bring forward a recommendation for the funding of this deficit with TIF funds
returned to the City from this District or available funds from another TIF District. Staff recommends
approval of the resolution.
Primary Issues to Consider
• Are there other options rather than decertifying the TIF District and terminating the agreement?
The only other option was for Mendell to seek an extension of the job creation deadline. That was
offered to Mendell, however they did not feel an additional year would be sufficient to hire the
required number of employees.
Supporting Information
• HRA Resolution
• Letter from Mendell
Financial Impact: $ Budgeted: Y☐ N☐ Source:
Related Documents: (CIP, ERP, etc.):
Envision Lakeville Community Values: Diversified Economic Development
Report Completed by: David L. Olson, Community and Economic Development Director
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